Record result for logistics company

Logistics company Freightways booked a record first-half
trading result, with revenue and profit up on a year ago due to
sound contributions from all its multiple divisions.

Operating revenues for the half to December were up 6%, from
$206.7 million to $218.2 million, earnings (operating profit)
before interest, tax, depreciation and amortisation (Ebitda)
were up 6% to $42 million, while after-tax profit was up 3%,
from $21 million to $21.7 million Freightways also benefited
from a one-off $1 million non-taxable benefit to operating
profit, from a belated earn-out payment from a European
acquisition, which it excluded from comparing with last
year's figures.

Shares in Freightways were up 1.3% at $4.63 following the
announcement. Its interim dividend is up from 9c to 10c.

Managing director Dean Bracewell said highlights included the
widespread strength of the result, which delivered record
performances in the express package and information
management businesses, plus several successful business
acquisitions which enhanced business positioning.

For second-half guidance, Mr Bracewell expected the growth
evident in the half-year result to ''continue for the
foreseeable future''.

Craigs Investment Partners broker Peter McIntyre said while
Ebit was up 2.7%, driven by 0.2% profit margin gain, profit
margins overall were similar to last year.

While gaining traction, volume growth was similar to the same
time last year.

Forsyth Barr broker Andrew Rooney said the result appeared to
be driven by growing New Zealand courier volumes, reflecting
the economic backdrop.

The key question for investors concerns Freightways
longer-term profit margins, which have been challenged by an
adverse margin mix for some time.

''A particularly positive characteristic of our half-year
performance is that it was widespread, with all Freightways
brands recording improved performance compared to the
previous corresponding period,'' Mr Bracewell said in a
statement.

Mr Bracewell said their collective operating revenue of $168
million for the half year was up 7% on a year ago.

The company's information management division again recorded
a strong result, on both sides of the Tasman, with revenue
growth in their respective currencies of 13% in New Zealand
and 9% in Australia, both ahead of a year ago.

There was also growth in document and computer back-up tape
storage, increased document destruction activity and in the
take-up of the digital services, he said.